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The Importance of a Pre-approval Letter in the Buying Process
Today
we would like to touch on just how important it is to have a pre-approval letter when you're in the process of buying a home here in
Austin.
The first thing you want to do if you're buying a home with financing is to visit a lender. It's extremely important to figure out how much you can afford to spend on a home before you go out and look for one to purchase. In fact, most sellers here in Austin will not even consider your offer if you aren't already pre-approved for a mortgage loan.
You should also know that there is a difference between pre-approval and pre-qualification. When you're pre-approved you have your credit checked and your assets verified. A pre-qualification is simply when you call a lender and speak on the phone about getting a loan - your credit is not checked and your financials are not looked at. You always want to be pre-approved, not pre-qualified, because a pre-qualification really does not mean a whole lot in the eyes of the seller.
As far as loans go, there are a few different programs you can choose from. FHA loans have a limit of about $300,000 with 3.5% down. Conventional loans require 5% down, and VA loans do not even require a down payment. Only about 25% of the transactions I do here in Austin involve cash, so it's very important to have your financing set up straight.
We have many preferred lenders that we work with, so please let us know if you would like us to put you in touch with one.
With that being said, please let me know if you need assistance buying, selling, or getting financing for a home here in Austin.
We look forward to speaking with you!
The first thing you want to do if you're buying a home with financing is to visit a lender. It's extremely important to figure out how much you can afford to spend on a home before you go out and look for one to purchase. In fact, most sellers here in Austin will not even consider your offer if you aren't already pre-approved for a mortgage loan.
You should also know that there is a difference between pre-approval and pre-qualification. When you're pre-approved you have your credit checked and your assets verified. A pre-qualification is simply when you call a lender and speak on the phone about getting a loan - your credit is not checked and your financials are not looked at. You always want to be pre-approved, not pre-qualified, because a pre-qualification really does not mean a whole lot in the eyes of the seller.
As far as loans go, there are a few different programs you can choose from. FHA loans have a limit of about $300,000 with 3.5% down. Conventional loans require 5% down, and VA loans do not even require a down payment. Only about 25% of the transactions I do here in Austin involve cash, so it's very important to have your financing set up straight.
We have many preferred lenders that we work with, so please let us know if you would like us to put you in touch with one.
With that being said, please let me know if you need assistance buying, selling, or getting financing for a home here in Austin.
We look forward to speaking with you!
